The Dawn of JUP: Solana Season?
The JUP token airdrop is imminent - could we see an injection of liquidity flow around the Solana ecosystem?
I’ll use a decade of traditional finance/corporate experience to refine the chaos into bite-sized chunks for you to digest.
First things first, grab a free coffee on me by downloading the Coffee #1 app. You’ll receive a free coffee after your first purchase in-store.
This newsletter consists of three parts:
Market Overview
Headline News
Views and Insights
Enjoy the journey.
This newsletter goes out weekly to ∼ 2,410 subscribers.
Please don't hesitate to message me directly for sponsorship, partnership enquiries or consultation requests.
Crypto markets have been choppy — Ethereum (ETH) experienced a sharp 9% downturn last Monday:
ETH previously pumped and Bitcoin (BTC) dumped on the spot BTC ETF approval.
BTC outflows continue from the Grayscale BTC Trust adversely affecting both the BTC and ETH charts.
ETH’s price volatility was exacerbated by the delays around an ETH ETF:
History rarely repeats, but it tends to rhyme: If so we could assume a similar pattern for the ETH chart until the spot ETH ETF is approved.
A gradual climb up with another sell-the-news event, then SOL pumping on suggestions of a SOL ETF next?
The Week Ahead:
The next week is lining up to be a volatile week for the markets in the short term.
The Purchasing Managers Index (PMI) is on Thursday, and Payrolls is on Friday.
What does this mean?
The PMI gauges the health of the manufacturing sector and the Payrolls report details employment statistics.
These reports can significantly impact investor sentiment including that of risk on assets, such as crypto.
Eyes will be on Solana specifically for crypto as the JUP airdrop lands on Wednesday with $1.3B of Blast liquidity unlocking in February also — the million-dollar question:
“Where will this liquidity go?”
Read section 3 for my views.
NFT Market Volume
Ethereum NFT market volume declined 50% to $109M this week ($72M in sales excluding wash trading):
Last week was a substantial pump in volume so there’s no surprise a slight drawback was on the cards as volume reverted to reasonable, pre-pump levels.
Bitcoin Ordinals sustain their trading activity as Taproot Wizard’s “Quantum Cats” collection goes live — one of which sold at Sotheby’s for $254K.
ETH trading volume is down on last week’s substantial increase:
Pudgy declined to 15 ETH this week as traders take profits on the 20 ETH run-up. The combined volume on Pudgys and Lil Pudgys exceeded CryptoPunks at $9M.
Azuki + Azuki Elementals aren’t far behind as the Anime news drives interest as licensing deals are struck with community members, including Dingalingts.
Meanwhile, someone dropped $800K on BeraChain Bears — speculation is that it could be for a corresponding airdrop.
The Defi centric layer 1 chain raised $42M Series A at a $420.69M (Nice) valuation back in April 2023 — It looks like those early supporters are looking for a juicy early adoption reward!
2. Bitcoin Ordinal volume: Quantum Cats mint is this week for 0.1 BTC ($4K) following the Sotheby’s sale. But Node Monkes continue to lead the charge.
Bitcoin Puppets jump this week as the memetic value prevails — all eyes are on Quantum Cats as Taproot Wizards are known synonymously with Bitcoin ordinals.
SOL NFT trading volume has declined to 100-150K SOL ($100-150M) daily:
Rubber caught the Solana NFT attention this week as many likened the art project to the Fidenzas of SOL — The floor ripped from 0.25 SOL ($25) to 20+ SOL ($2K).
Could this be the calm before the storm ahead of the JUP airdrop at the end of the month? The Wen token is labelled to be the trial run for the main event! Read later on for the analysis of JUP.
Notable Sales
Punks continue to maintain high-end sales this week as Hoodies, Cowboy hats and 3D Glasses come through above the floor.
Notable ETH NFT Sales
No significant change in the number of active wallets interacting with NFTs this week.
Headline News
Solana Season: Wen —> JUP Airdrop
MocaverseNFT officially announces $MOCA token
Mocaverse exceeds 300K MocaID holders
More time has been provided to claim the FRAME airdrop following community feedback, Mainnet launch has been pushed back
Nibiru Layer 1 Blockchain public sale goes live on Feb 1st on Coin List
Other News
Spellbornegame $1.35m fundraise
QuantumCatsXYZ wants to raise $12m with mint
OhBabyGames end of the seasons things will become tradable
TheTreeverse is launching on Immutable
Rabby_io introduces points for a future airdrop
The_Beacon_GG secures Arbitrum grant
Thirdweb becomes the official infrastructure provider for games on XAI_GAMES
H/t DUK for collating many of these headlines in his weekly roundup!
Solana Season: Wen —> JUP Airdrop
The Jupiter (Leading Solana DEX) will be launching its token on January 31st.
The $WEN token was a trial run using memetic value to Christen Meow’s (Jupiter Exchange founder) new launchpad, LFG.
The meme coin is in price discovery as it pushes a fully diluted market cap of $176M:
Solana Saga owners received an allocation that is now worth $111.
Predictions?
JUP is already trading on pre-market at $0.70 so it’s likely it’ll open around there.
If so then we could see a portion of profit taker liquidity enter the market as some airdrop recipients sell their airdrop allocation to place their bets elsewhere.
40% of the JUP token supply is allocated for airdrop. 10% (1 billion tokens) will be airdropped on Wednesday:
If it trades at $0.7 and a net 5% sell, then there could be $35M of liquidity that enters the wider SOL ecosystem on day 1 — and that’s a conservative estimate.
Where could this liquidity go?
Many of the recipients from the JUP airdrop are likely Solana ecosystem users — the cutoff for the initial airdrop (Nov 2nd, 2023) was before a significant influx of ETH maxis entered the ecosystem; around the Amsterdam Breakpoint event in October/November followed by the JITO airdrop in early December:
What does this mean?
Liquidity is likely to remain within the Solana ecosystem as deFi funds flow around SOL meme coins, and down the risk curve to SOL NFTs — we saw the impact of the JITO airdrop.
Now add this to the several imminent airdrops and there will be plenty of liquidity floating around:
NFT (Magic Eden Coin)
Tensor
Kamino, MarginFi, Parcl, Drift and many more SOL lending/perp protocols tokens
Flight to Quality
My bet is we will continue to see a flight to quality as leading NFTs that have anticipated airdrops (Tensorians, Mad Lads) absorb some of the profits and see a surge in price — maybe even some new pieces like Saga Monkes or Rubbers.
Solana Token
Or perhaps SOL maxis will take JUP profits into the SOL token itself — if users believe in Solana long term then it’s likely they will rotate into a safer (albeit still risky) asset that is anticipated to do well coming into the next bull run.
The VanEck report suggested SOL could hit $3K after all — why degen with risky meme coins when you can park your capital into SOL for a casual 30X over 6 years?
Remain in the JUP Ecosystem
JITO massively incentivized airdrop recipients to stake their tokens — we will likely see similar outcomes from the JUP airdrop as the team incentivizes season 2.
Perhaps the new beta of the perpetual module on the platform could be the next phase?
Solana ecosystem users gravitate towards JUP as a primary DEX for SOL tokens, so we could see volume exceed a billion USD daily as the season 1 airdrop tier 1 could see a threshold of $10M in volume to qualify for season 2.
Ultimately I’ll be monitoring ecosystem and developer activity, of which Solana is in third behind ETH and DOT:
There are existential risks but SOL remains a decent risk-reward bet for the next cycle.
That’s a wrap for issue 57 of S4mmy’s Snippets. I hope you enjoyed it.
Please leave me any questions or thoughts here - I will respond to everyone!
And if you thought this was interesting, please consider subscribing to this Substack and following me on Twitter for more on NFTs and Web 3.0.
Disclaimer: The content covered in this newsletter is not to be considered investment or financial advice. It is for informational and educational purposes only.
I hold some of the assets mentioned in this newsletter.